MonolithosDAO: a platform for decentralized finance with a built-in stablecoin
Stablecoins and DeFi projects have become symbols of the year 2020, which once again gave hope for the resumption of growth of the cryptocurrency market. The fall in oil prices, the COVID-19 pandemic, and the us-China standoff have all increased investors ' concerns about overly active actions to stimulate the economy by global regulators and Central banks, who are ready to fill the fire of the coming crisis with quantitative easing programs. In the last financial crisis of 2008-2009, this led to the birth of bitcoin. The current crisis can bring decentralized financial services and assets to a new level, where they will occupy a more significant niche.
The demand for decentralized financial services and stablecoins, which differ from true cryptocurrencies in less volatility, is confirmed by statistics.
The adjusted volume of transactions using stablecoins in June reached a new historical record, falling slightly short of $50 billion. According to the analytical service Messari, the market capitalization of the dollar-linked stablecoin Tether (USDT) reached $10.3 billion, although a year ago it did not exceed $3 billion. The demand for stablecoins is explained by the simplicity and ease with which transactions are conducted in these digital coins, and the lack of high volatility inherent in other cryptocurrencies.
Decentralized Finance is developing at an even faster pace. By rating debank.com, DeFi has already blocked assets of more than $2 billion. Most DeFi projects offer users the opportunity to earn passive income using various credit products, that is, they enter into direct competition with banking services that are less and less in line with the expectations and requests of customers.
The synthesis of these two directions - stable coins and decentralized Finance - can have a synergistic effect on the cryptocurrency market. So far, there are not many examples of such a synthesis of the two spheres of the crypto market. One of them is MonolithosDAO. This is a hybrid platform that combines the advantages of stablecoins and offers to use built-in DeFi services.
Unit network MonolithosDAO is scriptural MCR, digital coin, the rate is softly pegged to the Russian ruble at a ratio of 1:1. But unlike his piatogo prototype MCR are not subject to centralized management and controllers do not handle any power structure. The uniqueness of the cryptorubble from Monolithos is that it is the first digital coin linked to Fiat, which fully meets the criteria of the DAO community. Unlike the same Tether, the Issuer of one of the most popular and controversial stablecoins in the world, the MCR cryptorub is managed through a decentralized Autonomous organization, whose decisions are made collectively, taking into account the opinions of all network participants who have the right to vote.
MCR is resistant to inflation, since it has virtually no volatility as a stable coin, which makes it ideal for daily calculations and business operations as a measure of value and a means of deferred payment.
MonolithosDAO is based on the MakerDAO Protocol and runs on the Ethereum blockchain. This is a full-fledged DAO project-coordinated, scalable, and open source. The DAO is managed using two mechanisms — self-executing smart contracts and voting.
Mechanism for issuing DeFi-stablecoin
The integration of the architecture of decentralized Autonomous organizations into the DeFi project led to the birth of a completely new mechanism for issuing stablecoins. If in centralized digital projects, stablecoins are issued by a certain issuing organization, a company responsible for the Fiat provision of issued coins, then this principle of operation is not applicable for the DAO community, since it does not meet the philosophy of a decentralized project-collegiality. The developers of MonolithosDAO have found an elegant solution to this problem - the generation of MCR stablecoins is performed on the software that the user himself places on the platform. The Land platform was created for this purpose.
Land is a DeFi platform that exists in the MonolithosDAO ecosystem, created for trading, lending, depositing, and generating MCR. The user selects the type of collateral (for example, a pledge in the form of Ethereum tokens). The collateral is blocked, and MCR stablecoins are generated on this security. The security coefficient, i.e. the value of blocked ETH tokens to the value of issued cryptorubbles, must not be less than 125%.
Any digital coin based on Ethereum can become a collateral asset on the Land platform.participants of a decentralized organization with voting rights (i.e. holders of MDT tokens) have voted to accept It as collateral on the MonolithosDAO platform.
MCR holders can earn on their savings automatically. To do this, they need to place their own stablecoins on the DSR smart contract. The savings interest rate that is charged to the user is a variable parameter that can be changed by the decision of MonolithosDAO members with voting rights. This mechanism allows you to keep the MCR at the target price and prevent radical deviations from the ruble exchange rate.
A security Deposit that has been blocked can be refunded at any time. To recover the Deposit, in part or in full, the storage owner must pay part or all of the mCRs generated by them, as well as pay a stability fee that is constantly charged on outstanding mCRs (about 4%).
The most important thing is that Land is not a centralized platform where users are asked to entrust their digital assets for storage. Land is a decentralized platform that is accessible via the wallet that are supported by Ethereum. Users - and only they - have access to their assets.
Land is built on the basis of verified and formally verified smart contracts created by Maker, the industry leader in secure decentralized Finance.
As a decentralized Autonomous organization, MonolithosDAO is managed by its voting members. This right is available to those investors who are holders of MDT tokens.
At the same time, all participants, not only holders of MDT tokens, can make proposals regarding voting. But only those who own MDT will be able to vote for acceptance. They decide which coins to accept as collateral, what are the risk parameters for certain collateral assets (what determines the collateral ratio to the generated stablecoins), how to change the savings interest rate on DSR contracts, what updates to launch, and many other issues related to the operation of the DAO. Voting is also used to make decisions on non-technical aspects of the Protocol, such as asset priority lists, management processes, role mandates, and even electing individuals to perform specific duties. The system is designed in such a way that each of these actions brings direct or indirect profit to the community members, so MDT holders are interested in reasonable network management.
When voting, the number of votes is proportional to the number of MDTs that the voting participant sends to the address of the specific voting contract. The more MDT tokens a voter secures in the contract, the more influence they have on the decision-making process.
In total, there are 1 million MDT tokens in the MonolithosDAO system. 80% (800,000 MDT) of them will be distributed among community members during a two-stage tokesale.
On June 20, the first closed stage of the tokensale started, which will last until August 10. During the private round, 300,000 MDT will be sold at a price starting from $0.4. The second stage of the tokensale, which is scheduled for August 3, 2020, will begin with the listing of coins on Uniswap. In total, it is planned to sell 800,000 MDT, which is 80% of the total issue of stablecoins. At this time, the MonolithosDAO team will contribute 500,000 MDT and about $210,000 in ETH cryptocurrency to the created pool on the Uniswap platform.
Thus, at the heart of the MonolithosDAO economy is a transparent and thoughtful management system that maintains the stability of the MCR coin through certain incentives that encourage participants to make decisions that are beneficial to the entire system. And stablecoin MCR is suitable for hedging risks as a means of accumulating value and can be used as a means of circulation for decentralized applications.
Follow us on Twitter and join the telegram channel chat to stay up to date with the latest updates.. The documentation, white paper, and code base of Monolithos are publicly available on Github. You can also find more information about the project on the monolith.money website.